Creative Engagement --- Bob Murphy Challenges Paul Krugman

|Peter Boettke|

I saw this last week and exchanged emails with Bob about it. It is a very creative way to challenge Krugman to debate the fundamentals of business cycle theory and the evidence on the effectiveness of government policy.

As readers of this blog know, I am myopically academic in my own approach, but careful readers will also know that I respect broader outreach efforts to spread the ideas of free enterprise and classical liberalism. I just have no real comparative advantage in these activities myself, and I don't think these sort of activities have positive spill-over effects for those of us focused on the academy. But that is a positive statement, not a normative position. Let me be clear, I think these efforts are a net plus for the public understanding of economic freedom. I found the Russ Roberts' effort in the Fear the Boom and the Bust to be awesome, I think the PBS video clip on Tullock and voting is fantastic and use it in my classes. And I have to say that Bob's creative way to attempt to get Krugman to debate him on the merits of Austrian Business Cycle theory is amazing, so amazing in fact that I am in awe of his audaciousness in proposing it. Congratulations Bob, hope you get your wish.

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First, let me say that the video is delirious, if nothing else because over the many decades I've met libertarians who actually talk and think like these two characters. (Scary, but I've learned to live with it, as a libertarian myself.)

Second, this is a brilliant way to give a higher public profile to Austrian ideas. The fact is, over the last two or three years there has emerged an amazing underground of interest in and activism for Austrian Economics on the internet and in the blogosphere.

It is a fascinating "teach-in," in which non-economists, political news addicts, anti-government "movement" types, and a variety of others everyday are informing about, explaining, or attempting to apply "Austrian" ideas to the current situation.

Some are amateurish, simplistic, confused, or even misguided in mixing together matters relating to religion, ethics, and various cultural biases with aspects of Austrian Economic.

But others are intelligent, carefully reasoned, insightful in their applications of Austrian themes, and frequently clear in explaining things from Menger to Mises to less informed citizens on the internet.

The Mises Institute and Bob Murphy are simply taking this to a "new level" with this challenge to Paul Krugman. If, by some outside chance, Krugman were to accept,this would significantly raised the Austrian profile in the media in general and the internet in particular, world-wide.

If he does not accept this challenge, then this and related videos and internet commentaries will enable more publicity about the Austrian School to the informed (and, yes, the "uninformed") public in the United States, and beyond.

As for Bob's ability to "face" Krugman? Well, many on this site know that he is a well-read and articulate proponent of the Austrian perspective.

And . . . since Bob took Austrian Economics from me when he was an undergraduate at Hillsdale College, I'm confident that he knows what to say!

You would be surprised, Pete, how many of your professional peers learn much of what they know about e.g. Hayek from public sources such as Wikipedia. Indeed, I've seen a number of them directly grab quotes about Hayek from that entry.

As another example, I would suggest that recent discussions by mainstream macroeconomists of Hayek's Nobel lecture on macroeconomics and the limits of knowledge can trace a causal chain that began with Richard Armey's discussion of Hayek's ideas from that lecture in the widely read Wall Street Journal -- and it was clear at the time that Armey's quotes from that lecture came directly from my widely circulated blog post a week or two before on the Hayekian case against the Keynesian counter-revolution (linked by the widely read conservative blog "The Corner", etc.).

Are academic economists more isolated from the wider intellectual environment than are Supreme Court Justices? I'm not so sure.

Certainly the Nobel Prize in Economics is not completely unconnected with what is happening in the wider world.

Right now "mainstream" economists in Europe are directly forced by the actions and arguments of the governments to deal with the macroeconomic argument for "austerity" -- this is the outside world forcing the issue on economists most of whom otherwise would pretend they don't have answer the argument because they don't take it seriously enough even to entertain (and many of whom would like suppress the professional of any peer who would advance such arguments).

I have trouble thinking of "Austrian economists" who don't report having run into "Austrian" ideas essentially on their own, often before attending University. (Yes, I'm aware of the exceptions).

Yet these "self-starters" have helped create an independent academic tradition. And this process continues.

The principle "spill-over" effect that matters is the spill over among young people with energy, hunger, and flexible minds -- and in un-knowable ways this spill-over changes the profession over time in the turn-over of folks sitting in tenured academic seats.

Pete writes,

"I don't think these sort of activities have positive spill-over effects for those of us focused on the academy. But that is a positive statement"

Non-academic research tends to forget about the sociology of science: it tries to do without the opportunity to exchange ideas with experts, the variety of expertise in the same faculty, the ease of finding the relevant literature, the often tacit knowledge of how to write a paper and make an argument, the feedback in discussing ideas with high level critics. Making research outside the academia is like playing soccer with a broken leg. However, it's worth trying: it's fun. :-)

"I don't think these sort of activities have positive spill-over effects for those of us focused on the academy....I think the PBS video clip on Tullock and voting is fantastic and use it in my classes. "

I think that is is absolutely important to have the intelligent and informed exchange of ideas among and between academics.

But there is another level of discourse in the free and open society, in which public opinion and understanding matter, also.

And in that setting, in our intellectual division of labor, there is a crucial and valuable place for Menger and Mises for "the masses."

During his time, Mises certainly wrote for his fellow economists, for his world of academia -- "The Theory of Money and Credit," "Socialism,"
"Epistemological Problems of Economics," Human Action," "Theory and History."

But he also considered it important to share these ideas in ways that the non-academic, the informed and interested citizen, could understand -- "Liberalism," "Buraucracy," "Planning for Freedom," and hundreds of other articles both when he was still in Europe before 1940 and then in the United States.

The technologies of sharing and spreading information and knowledge have changed, but the relevance of both audiences, I would suggest, has remained the same.

Is it impossible to imagine that Krugman would consider debating Murphy if the Tea Party took over the Congress and the Presidency, and Robert Murphy was made the Chair of the Council of Economics Advisers or the Chairman of the Federal Reserve -- and the NY Times went into bankruptcy and was now edited by Bill Kristol, and Krugman was reduced to blogging at the Daily Kos?

If the power situation and the public intellectual environment changed, you actually can imagine Krugman being the one willing to pay someone to debate him ...

I note that the questions in economic science addressed by Mises and Hayek were shaped by what was happening and what was intellectually popular in their times -- i.e. war socialism, Fabian socialism, Marxism, "under consumption" economics, etc., intellectual movements much more outside of "academic economics" than within it.